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The funds will be returned from Paxful’s reserves.
According to a Bloomberg report, Celsius Network, the crypto platform that filed for bankruptcy in July 2022, demands that major customers who collectively withdrew over $2 billion before the bankruptcy return those funds to avoid potential litigation. An oversight committee formed during Celsiuss Chapter 11 case has begun contacting customers who withdrew more than $100,000 [...]
The post Celsius Fights To Reclaim $2 Billion Withdrawn Prior To Bankruptcy Declaration appeared first on Crypto Breaking News.
The global bitcoin exchange will dig into its own coffers to reconcile users who lost their money as a result of the collapse of Celsius. Global peer-to-peer Bitcoin platform Paxful announced it will provide almost nine bitcoin worth ~$250,000.00 to its Paxful Earn users who were affected by the Celsius collapse. The funds will be [...]
The post Paxful Announces Decision To Personally Return Lost Celsius Funds For Paxful Earn Users appeared first on Crypto Breaking News.
Celsius creditors are requesting subpoenas to uncover suspicious trades of CEL token on FTX between April and August 2022, seeking to determine if they were legitimate or constituted market manipulation. This information could be crucial in resolving disputes related to Celsius' bankruptcy. Meanwhile, FTX is pending approval to sell LedgerX for approximately $50 million. (Read More)
Celsius creditors say info from FTX is crucial in determining if some CEL trades were meant to inflate its price artificially.
A new company will be formed by the acquisition of embattled lender Celsius, which went bankrupt amidst the larger turmoil of 2022.
Celsius Network, the digital asset lender that filed for bankruptcy protection in July last year, has selected Fahrenheit’s bid to restart the business under a new name, NewCo. Fahrenheit is a group of investors that includes Bitcoin mining company, US Bitcoin Corp.; crypto investment firm, Arrington Capital; and technology consulting firm, Proof Group. Steven Kokinos, a former Algorand CEO, and Ravi Kaza, an angel investor, are also part of the group.
Celsius announced the development on Thursday, noting that it also secured a backup bid with Blockchain Recovery Investment Consortium (BRIC), which is a group of investors that fund blockchain firms battered by the crypto market downturn. The agreement includes provisions for the investors to fund a public mining firm potentially to be managed by crypto miner GlobalXDigital.
?? @FahrenheitHldg won, #BRIC is backup. It's official. Term sheet included. I’ll cover more on my Space tonight #Celsius Creditors https://t.co/jrCiZ7rv2A ?? to all who participated. https://t.co/CSk93ui5Wa
— Simon Dixon (@SimonDixonTwitt) May 25, 2023Fahrenheit to Fund Celsius Reboot
Celsius in a statement noted that Fahrenheit’s winning bid was selected after a court-approved auction process and in partnership with the bankruptcy company’s unsecured creditors. The bid proposes to provide the capital, management team and technology needed to successfully establish and run NewCo, which will be owned by Celsius creditors.
The bid selection comes after Celsius folded up in June 2022 after initially suspending crypto withdrawals on its platform, citing market volatility. The digital asset lender became insolvent following the Terra-Luna collapse that sent shockwaves across the global crypto industry last year.
In the aftermath of its fall, Celsius has been facing several investigations in the United States and Alex Mashinksy, its Co-Founder, was recently charged with fraud. However, the latest development shows the failed digital lending business is making progress in its efforts to reorganize under a new entity.
Customers to Get ‘Hundreds of Millions of Dollars’
Announcing the winning bid, Celsius noted that Fahrenheit’s bid will be executed in accordance with its reorganization plans. According to the plan, NewCo for the benefit of account holders will manage Celsius’ illiquid assets, including its institutional loan portfolio, mining business and alternative investments.
The plan also provides for the distribution of ‘hundreds of millions of dollars of additional liquid cryptocurrency' to Celsius’ customers. Compared to what Celsius called ‘the stalking horse bid’ put forward at the start of the auction process, Fahrenheit’s bid cuts down proposed management fees by hundreds of millions of dollars.
“The winning bid also provides attractive offers for Celsius to immediately energize its mining rigs that are currently inactive and for NewCo to build its mining business over time,” Celsius said, noting that NewCo will be managed by a new Board of Directors majorly appointed by its creditors.
Furthermore, the crumbled digital lender pointed out that 100% of the new equity in NewCo will be owned by its account holders, again in accordance with its reorganization plan.
“In the coming weeks, Celsius intends to negotiate and publicly file a plan sponsor agreement with Fahrenheit, a backup plan sponsor agreement with the BRIC, a revised chapter 11 plan, and a disclosure statement, all of which remain subject to bankruptcy court approval,” the lender explained.
Gate.io in Hong Kong; CFI's new office; read today's news nuggets.
This article was written by Solomon Oladipupo at www.financemagnates.com.Creditors of the bankrupt crypto lending firm Celsius Network recently amended their lawsuit to accuse Wintermute, a major crypto market maker, of participating in a [...]
The bankrupt cryptocurrency lending platform has leveled allegations against Wintermute, a prominent crypto market maker. Claiming that they actively participated
Core Scientific said favorable market conditions have increased its liquidity position and its bankruptcy restructuring plan has been revised.
An unnamed source disclosed that the new bidders are most likely to win the auction as they are established crypto operators.
The settlement would also bar those who accept it from ulterior legal action against Celsius.
Whitelisted accounts will be able withdraw 94% of their original funds.
Stablecoin issuer Tether has denied claims that it borrowed $2 billion from failed cryptocurrency lender Celsius, following a nearly 700-page report filed on Tuesday, January [...]
Celsius Network, co-founded by serial entrepreneur Alex Mashinsky, spent at least $558 million purchasing its own token, CEL. According to the latest filing, the cryptocurrency [...]
The business model Celsius advertised and sold to its customers was not the business that it actually operated.
For Bitcoin, 2022 was a year of lessons, frustrations, vindications, progress and, in some cases, regress. What should we take with us for 2023?
<p class="MsoNormal">Letitia James, the Attorney General of the State of New York, has charged Alex Mashinsky, the Co-Founder of bankrupt crypto lender Celsius Network, with fraud.</p><p class="MsoNormal">In a lawsuit <a href="https://ag.ny.gov/sites/default/files/mashinsky_complaint.pdf" target="_blank" rel="follow">filed</a> before a supreme court in the County of New York on Thursday, James accused the former CEO of “defrauding hundreds of thousands of investors, including more than 26,000 New Yorkers, out of billions of dollars worth of cryptocurrency.”</p><p class="MsoNormal">“Mashinsky repeatedly claimed that Celsius made safe, low-risk investments and only lent assets to credible and reputable entities. However, investors’ assets were routinely exposed to high-risk counterparties and strategies, many of which resulted in losses that Mashinsky concealed from investors,” James said in <a href="https://ag.ny.gov/press-release/2023/attorney-general-james-sues-former-ceo-celsius-cryptocurrency-platform-defrauding" target="_blank" rel="follow">a statement</a>.</p><p>Watch the recent FMLS22 session on cryptocurrency with participation from Dr. Lisa Cameron, Member of Parliament, UK House of Commons.</p><p class="MsoNormal text-align-justify">New York Accuses Celsius of Leaving Investors in ‘Financial Ruin’</p><p class="MsoNormal">The New York Attorney General also accused Mashinsky of mispresenting and hiding Celsius’ worsening financial condition from its investors even as it was losing “hundreds of millions of dollars of assets in risky investments.” She added that Mashinksy has left many investors in "financial ruin” as a result. </p><p class="MsoNormal">In her filing before the court, the chief law officer asked the court to permanently bar Mashinsky from dealing in any business relating to the issuance, offer or sale of securities or commodities in New York. James also wants the court to stop the ex-Celsius CEO from serving as a director or officer or any New York-based firm. </p><p class="MsoNormal">In addition, the Attorney General asked the court to order Mashinksy to give up profits obtained from the failed crypto lender business as well as return investor funds with additional payment for damages.</p><p class="MsoNormal text-align-justify">The Collapse of Celsius Network</p><p class="MsoNormal">In July last year, Celsius Network <a href="https://www.financemagnates.com/cryptocurrency/news/crypto-lender-celsius-files-for-bankruptcy-in-new-york/" target="_blank" rel="follow">filed for Chapter 11 bankruptcy</a> before a New York court over a month after it <a href="https://www.financemagnates.com/cryptocurrency/news/celsius-suspends-crypto-withdrawals-due-to-market-volatility/" target="_blank" rel="follow">paused withdrawals</a> on its platform, citing volatile markets. </p><p class="MsoNormal">The crypto lender’s failure came in the aftermath of <a href="https://www.financemagnates.com/cryptocurrency/terra-luna-how-these-7-wallets-brought-the-ecosystem-to-its-knees/" target="_blank" rel="follow">the Terra-LUNA collapse</a> which also saw the death of <a href="https://www.financemagnates.com/cryptocurrency/binanceus-wants-to-acquire-bankrupt-crypto-lending-platform-voyager/" target="_blank" rel="follow">Voyager Digital</a> and <a href="https://www.financemagnates.com/cryptocurrency/news/three-arrows-capital-gets-liquidation-order-from-bvi-court/" target="_blank" rel="follow">Three Arrow Capital</a>. The collapse of Celsius Network was followed by <a href="https://www.financemagnates.com/cryptocurrency/news/celsius-network-reportedly-faces-us-federal-investigation/" target="_blank" rel="follow">a barrage of investigations</a> from US federal and state regulators. </p> This article was written by Solomon Oladipupo at www.financemagnates.com.
<p class="MsoNormal">Letitia James, the Attorney General of the State of New York, has charged Alex Mashinsky, the Co-Founder of a bankrupt crypto lender Celsius Network, with fraud.</p><p class="MsoNormal">In a lawsuit <a href="https://ag.ny.gov/sites/default/files/mashinsky_complaint.pdf" target="_blank" rel="follow">filed</a> before a supreme court in the County of New York on Thursday, James accused the former CEO of “defrauding hundreds of thousands of investors, including more than 26,000 New Yorkers, out of billions of dollars worth of cryptocurrency.”</p><p class="MsoNormal">“Mashinsky repeatedly claimed that Celsius made safe, low-risk investments and only lent assets to credible and reputable entities. However, investors’ assets were routinely exposed to high-risk counterparties and strategies, many of which resulted in losses that Mashinsky concealed from investors,” James said in <a href="https://ag.ny.gov/press-release/2023/attorney-general-james-sues-former-ceo-celsius-cryptocurrency-platform-defrauding" target="_blank" rel="follow">a statement</a>.</p><p>Watch the recent FMLS22 session on cryptocurrency with participation from Dr Lisa Cameron, a Member of Parliament in the UK House of Commons.</p><p class="MsoNormal text-align-justify">New York Accuses Celsius of Leaving Investors in ‘Financial Ruin’</p><p class="MsoNormal">Additionally, the New York Attorney General accused Mashinsky of mispresenting and hiding Celsius’ worsening financial conditions from its investors even as it was losing “hundreds of millions of dollars of assets in risky investments.” She added that Mashinksy had left many investors in "financial ruin” as a result. </p><p class="MsoNormal">In her filing before the court, the Chief Law Officer asked the court to permanently bar Mashinsky from dealing in any business relating to the issuance, offer or sale of securities or commodities in New York. Moreover, James wants the court to stop the ex-Celsius CEO from serving as a Director or officer or any New York-based firm. </p><p class="MsoNormal">In addition, the Attorney General asked the court to order Mashinksy to give up profits obtained from the failed crypto lender business as well as return investor funds with additional payment for damages.</p><p class="MsoNormal text-align-justify">The Collapse of Celsius Network</p><p class="MsoNormal">In July last year, Celsius Network <a href="https://www.financemagnates.com/cryptocurrency/news/crypto-lender-celsius-files-for-bankruptcy-in-new-york/" target="_blank" rel="follow">filed for Chapter 11 bankruptcy</a> before a New York court over a month after it <a href="https://www.financemagnates.com/cryptocurrency/news/celsius-suspends-crypto-withdrawals-due-to-market-volatility/" target="_blank" rel="follow">paused withdrawals</a> on its platform, citing volatile markets. </p><p class="MsoNormal">The crypto lender’s failure came in the aftermath of <a href="https://www.financemagnates.com/cryptocurrency/terra-luna-how-these-7-wallets-brought-the-ecosystem-to-its-knees/" target="_blank" rel="follow">the Terra-LUNA collapse</a> which saw the demise of <a href="https://www.financemagnates.com/cryptocurrency/binanceus-wants-to-acquire-bankrupt-crypto-lending-platform-voyager/" target="_blank" rel="follow">Voyager Digital</a> and <a href="https://www.financemagnates.com/cryptocurrency/news/three-arrows-capital-gets-liquidation-order-from-bvi-court/" target="_blank" rel="follow">Three Arrow Capital</a>. The collapse of Celsius Network was followed by <a href="https://www.financemagnates.com/cryptocurrency/news/celsius-network-reportedly-faces-us-federal-investigation/" target="_blank" rel="follow">a barrage of investigations</a> from US federal and state regulators.</p> This article was written by Solomon Oladipupo at www.financemagnates.com.
The lawsuit seeks disgorgement of any proceeds derived from Mashinsky's unlawful practices as well as restitution for investors.
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